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Hong Kong stocks fell below the value of their net assets for the first time since 1998 as concerns over capital outflows and China’s economic slowdown deepened a bear market.

The Hang Seng Index slumped 1.8 percent at the close, sending its price-to-book ratio below one. The last time the gauge traded below that level, the Asian financial crisis was roiling the region’s markets and bursting a property bubble in the city. The Hong Kong dollar traded near its lowest level since August 2007, while the benchmark money market rates jumped to the highest since May 2009.

Money is flowing out of Hong Kong, one of the world’s most open economies, as China’s growth slows to the weakest pace since 1990 and speculators bet on an end to the city’s currency peg to the dollar. The capital outflows are pushing up benchmark interest rates, heightening concern that higher financing costs will weigh on the city’s banking and real estate industries.

The Hang Seng Index has already plunged 15 percent this year, while Hong Kong dollar forwards sank to their weakest level this century on Wednesday. More than half of the stock gauge’s 50 members trade at a price-to-book ratio below one, with New World Development Co. and Wharf Holdings Co. priced at less than 0.4 times the value of their net assets, data compiled by Bloomberg show. Centaline Property Agency Ltd.’s gauge of secondary home prices has slumped almost 9 percent from its September record.